Annexes to COM(2022)388 - 2015-2020 report on the financial situation of the unemployment insurance scheme for unemployed former EU temporary or contract staff and EP assistants - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2022)388 - 2015-2020 report on the financial situation of the unemployment insurance scheme for unemployed former EU temporary or ... |
|---|---|
| document | COM(2022)388  |
| date | August 8, 2022 |
-Articles 135 and 136 of the CEOS as amended by Regulation No 1239/2010 of the European Parliament and of the Council of 20 December 2010 (OJ L338, 22.12.2010) 4 .
-Article 65(1) of the Staff Regulations on the updating of remuneration and other amounts.
-Commission Regulation No 91/88 of 13 January 1988 laying down provisions for implementing Article 28a(2) of the Conditions of Employment of Other Servants of the European Union (OJ L 11, 15.1.1989) 5 .
-Commission Rules of 14 July 1988, common accord having been recorded by the President of the Court of Justice of the European Communities on 4 July 1989, laying down the detailed arrangements for applying the provisions relating to the grant of the unemployment allowance to members of the temporary staff, implementing Article 28a(10) of the Conditions of Employment of Other Servants of the European Union.
2Financial position and cash balance of the Unemployment Fund 2015-2020
This section presents developments in the financial position of the Unemployment Fund, in particular its revenue and expenditure.
The amounts under ‘Unemployment allowances’ systematically include the basic unemployment allowance and any family allowances. Any social benefits received at national level (unemployment benefits, family allowances, sickness benefits, childbirth benefits, etc.) are deducted. Finally, as indicated above (1.1), the JSIS contribution is financed by the Unemployment Fund (5.1% of the reference basic salary of the unemployed person).
The Unemployment Fund uses two management instruments for its revenue and expenditure:
·a current account for collecting revenue and paying allowances;
·term accounts for investing accumulated surpluses.
2.1Cash balance: operating results and accumulated balances 2015-2020
Under cash-based accounting, transactions are recorded only when there is money incoming or outgoing.
Table 1 gives a summary of revenue and expenditure as entered in the accounts and the resulting current balance.
Table 2 shows the evolution of the Unemployment Fund's financial assets both in the current account incorporated in the European Commission’s accounting system (part I) and in the investment accounts managed by DG BUDG (before 2019, DG ECFIN) (part II). Part III shows the total accumulated surpluses for these two accounts.
Table 3 shows the accumulated balance of the Fund. Between 2015 and 2018, the accumulated surplus increased significantly to reach a maximum in 2019 (EUR 30.7 million). It was down at the end of 2020 (EUR 29 million).
This can be explained by the fact that expenditure was impacted by the change of parliamentary term. Expenditure on APAs fell significantly as of 2016 and then rose again significantly as of 2019 to reach a maximum in 2020.
Revenue from contributions from the various institutions and agencies increased by almost EUR 10 million over the period concerned.
2.2Financial position: operating results 2015-20
In accruals accounting, transactions are recorded in the accounts at the moment when the contribution to the Unemployment Fund or the payment of unemployment benefit is due. This means that
·some contributions received at the start of year N cover periods of activity at the end of year N-1,
·some amounts paid at the start of year N cover periods of unemployment at the end of year N-1.
In accordance with the relevant accounting standards, these transactions are charged to financial year N-1.
Table 4 sets out the revenue and expenditure according to this principle and therefore reflects the Unemployment Fund’s annual financial position with regard to revenue and expenditure.
There were significant increases in expenditure from 2013 to 2015, primarily owing to the new parliamentary term of the European Parliament and the payment of unemployment allowance to eligible APAs. Nevertheless, from 2016 this expenditure decreased because a majority of APAs ceased to be eligible for unemployment benefits and CA contracts were extended from 3 to 6 years (2014 reform of the Staff Regulations). This expenditure increased again significantly in 2019 and 2020 with the end of the European Parliament’s parliamentary term (in mid 2019) and the end of the Commission's term of office (end of 2019).
The Fund’s current account balance was in deficit by more than EUR 3 million in 2015; however, the period 2016 to 2018 saw an annual surplus of around EUR 10 million. Following a smaller surplus in 2019, the Fund recorded a deficit of EUR 0.5 million in 2020, due to the end of the European Parliament’s parliamentary term and the end of the Commission’s term of office.
Operating results 2015 -2020
2.3Financial position: breakdown of expenditure and revenue by institution and for all the agencies 2015-2020
Table 5 provides a breakdown of expenditure and revenue by institution and for all the agencies. The first part of the table provides the absolute amounts, while the second part shows the amounts as percentages of total expenditure and revenue. The cyclical effect of the end of the European Parliament’s parliamentary term is particularly visible, with a sharp decrease in expenditure related to the European Parliament of EUR 6.5 million between 2015 and 2016, to reach some EUR 3 million in 2018. It rises again as of 2019 to reach a maximum in 2020, at more than EUR 13 million.
The agencies contribute much more than their share of expenditure. This situation can be attributed to the fact that some of their staff members have open-ended contracts. However, it should be noted that expenditure on former staff of the agencies was falling up until 2018 and then started to rise again slightly (EUR 5 million) in 2020, a fall of almost 19% compared with 2015.
3Analysis of persons insured, beneficiaries and allowances paid
3.1Number of persons insured and average contribution
Table 6 shows the number of TAs, CAs and APAs paying into the Unemployment Fund who were in active service on 31 December of each year.
3.2Number of persons receiving unemployment allowance in absolute terms and as a percentage of the number of persons insured: ‘unemployment rate’ at 31 December of the year in question
Table 7 shows the number of unemployed persons who received an unemployment allowance in full or as a top-up to benefits received under the national system for the month of December each year.
Note that the number of beneficiaries who received an allowance for at least one month of the year was strongly affected by the effects of the end of the previous parliamentary term.
By combining the data on TAs, CAs and APAs in service on 31 December in Table 6 and the number of beneficiaries who received an unemployment allowance shown in Table 7, it is possible to calculate the ratio of beneficiaries of the Unemployment Fund to the number of persons insured under that Fund. The results are set out in Table 8.
For TAs, the number of recipients of unemployment allowance as a ratio of members of the scheme remains stable (3%). As far as CAs are concerned, beneficiaries as a ratio of members increased significantly, almost doubling from 1.83% to 3.56%.
For 2019 and 2020, because of the end of the parliamentary term, a high number of former APAs were drawing the allowance (400 in 2019 and 291 in 2020). The ratio of beneficiaries to members was therefore significant in those years (22% and 15% respectively), whilst it is normally around 2 or 3%. This is consistent with the observations made at the end of the previous parliamentary term.
3.3Number of monthly unemployment allowances paid, average amount, beneficiaries, and country of residence of beneficiaries
Pursuant to Articles 28(4) and 96(4) of the CEOS, unemployment allowance is paid for a period corresponding to one third of the period of service but not exceeding 36 months. Table 9 shows the number of monthly unemployment allowances paid to all beneficiaries each year. The table shows the impact on APAs of the change of parliamentary term, and the impact on TAs of the change of Commission (impact in 2015 and 2020).
Table 10 below shows the average amount of unemployment allowance by beneficiary category. This amount corresponds to the total annual expenditure for each type of beneficiary (TA, CA and APA), divided by the number of monthly payments made. It should be noted that in any given month the allowance paid may be the full amount or a pro-rata amount based on the number of days on which the person was actually entitled to the unemployment allowance.
Whilst the amounts paid to the various beneficiaries in 2020 are relatively stable compared to the previous year, a slight decrease among APAs can be seen, resulting from the degressive nature of the unemployment allowance.
Table 11.1 sets out the average duration in months of unemployment allowance paid during one year, including any earlier benefits owed. This duration corresponds to the total number of days for which the allowance was paid up to 31 December of the year in question, divided by the number of recipients of the unemployment allowance. The result obtained is divided by 30 to obtain the average period in months for which the unemployment allowance was paid.
The average duration in months of unemployment allowance has been stable over the past 6 years (between 8 and 10 months).
The following tables show the duration of payments by staff category (TAs, CAs and APAs).
CA/TA:
APA:
Although expenditure relating to APAs as a share of overall expenditure is high in 2015, 2019 and 2020 (31%, 33% and 31% respectively) this is due both to the number of staff in this category and to the high average amount of the monthly allowance. The average duration of the period of benefit cover in 2015 and 2016 (13 months) was significantly greater than for CAs and TAs, a direct consequence of the increase in the number of APAs eligible for the unemployment allowance. This period then decreases substantially to reach a minimum in 2019 (5 months), before doubling the following year to 10 months.
Having regard to the principle of complementarity as applied to the unemployment insurance scheme, the country of residence of the recipient of the unemployment allowance is significant, particularly in view of the different eligibility criteria for national unemployment benefit in the different Member States.
Table 12 shows the countries of residence of beneficiaries who received at least one monthly allowance during the year.
It should be noted that, until the end of the transition period on 31 December 2020, the UK was considered to be a Member State 6 , allowing former staff to receive unemployment allowance while living in the UK. Moreover, after the end of the transition period and pursuant to Article 115 of the Withdrawal Agreement, Articles 28a, 96 and 136 of the CEOS will apply to other servants of the Union of any nationality, including former servants who contributed to the EU unemployment scheme before the end of the transition period if they reside in the United Kingdom and are registered with the UK unemployment services.
In 2015, almost half of beneficiaries were registered as jobseekers in Belgium. This proportion remained stable during the reference period, varying between 42.86% and 49.47%.
4CONCLUSIONS
4.1Period 2015 -2020
A succession of positive financial years between 2016 and 2019 allowed the reserve to remain at more than EUR 29 million despite a deficit of EUR 1.3 million in 2020.
In accordance with the conclusions of the previous report on the financial position of the unemployment insurance scheme, the Commission carried out regular monitoring of the scheme’s financial position. In particular, the Commission continued to assess whether the balance of the scheme required adjustment of the rates of contribution to the scheme’s financing, which it did not up to the end of 2020.
4.2Prospects of the Unemployment Fund in the short and medium term
On the basis of past observations, it seems that the substantial reserve achieved at the end of 2020 will further grow until the end of the current parliamentary term and the transition to the new mandate of the College of Commissioners in 2024-2025.
It should also be stressed that there are other factors that could increase expenditure, such as the use of temporary agents in the Commission, inflation as well as the current uncertain economic context.
The Commission will therefore assess the opportunities for investing amounts from the reserve, depending on market conditions. It will also regularly monitor the financial situation of the scheme, which was in deficit in 2020, before assessing the possibility of amending the arrangements for the balance and financial stability of the Fund, pursuant to Article 28a(10) of the CEOS.
(1) Regulation (EU, Euratom) No 1023/2013 of the European Parliament and of the Council of 22 October 2013.
(2) OJ L 55, 27.02.2009.
(3) COM(2020) 110 final.
(4) OJ L 338, 22.12.2010.
(5) OJ L 11, 15.1.1989
(6) Article 127(6) of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community, 2019/C 384 I/01.